If Net Sales on the Operating Statement for Brandywine Company

Multiple Choice

If net sales on the operating statement for Brandywine Company were $200,000--and gross sales were $240,000--what would the cost of sales be if the gross margin was 20 percent?

A) $140,000
B) $168,000
C) $160,000
D) $120,000
E) Cannot be determined without knowing Brandywine's expenses and net profit.